August 5, 2009
India wheat higher on lower grain production outlook
Indian wheat futures are seen up on Tuesday (Aug 4) on the expectation of higher demand driven by a drop in rice sowing, though soaring stocks and an export ban may limit gains, analysts said.
The August futures contract NWTQ9 on National Commodity and Derivatives Exchange ended at Rs1,125.4 (US$ 23.6) per 100 kg, down 0.37 percent.
As on July 30, due to weak monsoon rains, paddy sowing area fell to 19.13 million hectares from 25.68 million hectares, which may increase the focus on wheat as an alternative grain resource for India, analysts said.
India last month banned export of any wheat or rice through diplomatic arrangements.
Wheat stocks stood at 36 million tonnes as on July 1, more than double the required buffer norm of 17 million tonnes.
The government may sell a part of its bulging wheat stocks in the local market to control domestic prices.
